Department of Defense National Security Personnel System

1
Department of DefenseNational Security
Personnel System
Flexibility Accountability Excellence

• www.cpms.osd.mil/nsps

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How We Got Here

• November 2003, Congress granted DoD broad
  authority to establish a new human resources
  management system to support its critical
  national security mission
• Early 2004, DoD adopted acquisition management
  model for NSPS program
• Program Executive Office established for design
  and implementation
• Oversight and guidance from senior leadership
• Partnership with OPM

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How We Got Here (Contd)

• Conducted over 100 Focus Groups and 50 Town Hall
  meetings worldwide
• Gathered input from employees, supervisors, union
  officials, and HR practitioners
• Reviewed and considered data and reports from
  existing alternative personnel systems
• DoD demonstration projects and other Federal
  agencies
• Held several meetings with DoD employee unions
• Over 40 labor organizations
• Shared interests and concerns
• Discussed potential design options
• Gathered input for system design

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How We Got Here (Contd)

• Convened six design working groups to develop
  options for senior leadership consideration
• Input from numerous stakeholders
• Employees
• Unions
• Managers
• Public interest groups
• Senior leaders
• Included over 100 participants from DoD and OPM
• HR experts, military members, line managers, and
  functional area experts (EEO, labor relations,
  legal, comptroller)

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How We Got Here (Contd)

• Senior leadership reviewed options and
  recommended a proposed system design
• Secretary Rumsfeld and OPM Director James
  approved proposed regulations
• February 14, 2005, Federal Register Notice issued
  for public review with comments due March 16,
  2005

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Design Principles Operational Requirements

• Guiding Principles
• Put mission first support National Security
  goals and strategic objectives
• Respect the individual protect rights guaranteed
  by law
• Value talent, performance, leadership and
  commitment to public service
• Be flexible, understandable, credible,
  responsive, executable
• Ensure accountability at all levels
• Balance HR interoperability with unique mission
  requirements
• Be competitive and cost effective

• Key Performance Parameters
• High Performing Employees/supervisors are
  compensated/retained based on performance/contribu
  tion to mission
• Agile Responsive Workforce can be easily
  sized, shaped, and deployed to meet changing
  mission requirements
• Credible and Trusted System assures openness,
  clarity, accountability and merit principles
• Fiscally Sound Aggregate increases in civilian
  payroll, at the appropriations level, will
  conform to OMB fiscal guidance managers will
  have flexibility to manage to budget
• Supporting Infrastructure Information
  Technology support and training and change
  management plans are available and funded
• Schedule NSPS will be operational and
  demonstrate success prior to November 2009

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What NSPS Does Not Change

• Merit System Principles
• Rules against prohibited personnel practices
• Whistleblower protection
• Veterans Preference
• Benefits (retirement, health, life, etc.)
• Anti-discrimination laws
• Fundamental due process
• Allowances and travel/subsistence expenses
• Training
• Leave and work schedules
• Other personnel systems in law
• Lab Demo organizations (until FY 08)

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Regulation Strategy
Enabling Regulations Detailed information on
Labor Relations, Adverse Actions and
Appeals Broad Information in Other Areas
DoD Instructions More Detailed Information on
Compensation, Performance Management, Hiring,
Shaping, and Employee Engagement
Component Instructions Component-Specific
Guidance
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NSPS Major Design Elements

• Classification
• Pay architecture
• Job descriptions
• Occupational groupings

• Adverse Actions
• Dealing with performance and/or conduct problems
• Procedures for taking actions

• Hiring
• Hiring authorities
• Examining procedures

• Pay/Compensation
• Market sensitive pay
• Performance-based pay
• Pay setting

• Appeals
• Procedures for appealing adverse actions
• MSPB role

• Reduction in Force
• Procedures for resizing organizations
• Defining competitive areas
• Factors for retention

• Performance Mgmt
• Setting expectations
• Communicating/feedback
• Appraising performance
• Addressing poor performance

• Labor Relations
• Collective bargaining rights
• Scope of bargaining
• Bargaining process
• Resolving labor disputes

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Pay Band Illustration
Sample NSPS Pay Band Structure Career Group APay
Schedule 1 (nonsupervisory)
Level 3 Senior Expert
Level 2 Full Performance Level
Level 1 - Entry/Developmental

• Levels represent rate ranges associated with
  ranges of work in career group
• Rates (minimum/maximum) may be set and adjusted
  based on market factors
• Separate pay schedules may be established for
  certain occupations, where market or other
  conditions warrant

Next
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Other Regulatory Provisions

• Coordination with Office of Personnel Management
• Actions impacting other Federal agencies or civil
  service as a whole
• Examples establishing career groups and pay
  bands establishing new qualifications standards
  setting maximum pay rates setting pay ranges and
  local market supplements
• Continuing Collaboration
• Include unions in further development of NSPS
• Provide opportunity for unions to review and
  comment on draft proposals and discuss their
  views with DoD officials prior to issuance
• Provide that union comments will become part of
  official record and considered prior to
  finalization of proposal
• Program Evaluation
• Formal procedures required by regulations to
  assess and evaluate NSPS implementation
• Provides opportunity for unions to participate in
  process

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Who is Affected by NSPS?

• NSPS Human Resources System (Pay, performance,
  hiring, RIF, adverse actions, and appeals
  provisions)
• Vast majority of DoD employees eligible for
  coverage initially apply only to selected
  General Schedule employees in Spiral One
  organizations Certain categories excluded (e.g.,
  intelligence personnel, Defense Labs)
• Employees in special pay/classification systems
  (e.g., wage grade) will be phased in later (not
  sooner than eighteen months)
• NSPS Labor Relations System
• Applies to all employees and labor organizations
  currently covered by Chapter 71 of title 5
• Will be implemented across entire Department when
  final regulations are effective

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Implementation Challenges

• Changing culture from Entitlement to Performance
• Pay linked to performance
• Performance evaluations to be measurable and tied
  to business results
• Budgeting/Managing Costs
• Ensuring pay pool funds protected
• Within-grade buyout funds availability
• Technology
• Tools for documenting and tracking performance
• goals/pay models
• Modifying IT systems for transition to NSPS
• Training

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NSPS Training

• Target audiences
• Senior leaders, managers, and supervisors
• Employees
• HR and LR practitioners
• Pay pool managers/administrators
• Dual focus
• Functional training (NSPS system)
• Change management (soft skills)
• Learning objectives
• Foster a culture that focuses on results, values
  performance, rewards contributions, and promotes
  excellence
• Educate employees about NSPS
• Teach skills and behaviors necessary to implement
  and sustain NSPS

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Next Steps

• Analyze and consider over 45,000 comments on
  proposed NSPS regulations
• Meet and confer period with employee unions
  (minimum of 30 days)
• Discuss differences attempt to reach agreement
• Assistance from Federal Mediation and
  Conciliation Service
• Notify Congress of outcome of meet and confer (30
  days)
• Finalize regulations issue implementing issuances

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Five Ways Employees Can Get Ready for NSPS

• Be proactive! Visit the NSPS web site regularly
  to stay up-to-date on the latest NSPS information
• www.cpms.osd.mil/nsps
• Review your organizations mission and goals.
  Think about what you can do help achieve those
  goals
• View this as a positive change. Make a
  difference!
• 4. Read the Federal Register Notice and submit
  comments by March 16
• Contact your local NSPS program office about
  local NSPS training

Stay informed!
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Five Ways Managers and Supervisors Can Get Ready
For NSPS

• Reinforce organizations mission and goals
• Help staff understand how their work contributes
  to achieving those goals
• Visit NSPS website regularly to stay up-to-date
  on the latest NSPS information
• www.cpms.osd.mil/nsps
• Host periodic formal and informal meetings to
  share what you know
• Establish a peer network

Lead the way!
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Questions ?www.cpms.osd.mil/nsps
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Most Frequently Asked Questions

• Will employees lose pay under NSPS? No
• Employees will not lose pay upon conversion to
  NSPS some will have a pay increase
• What happens to the January (general) pay
  adjustment (GPI)?
• Funds will be paid out as a result of
• Performance payout process
• Rate range adjustments
• Local market supplements
• Advancement in development positions
• What about the January 06 GPI for Spiral 1.1
  employees?
• Employees must have been under the new system
  long enough to be evaluated properly before GPI
  can be placed at risk close to one year

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Most Frequently Asked Questions (Contd)

• What about within grade increases?
• Under proposed regulations
• Employees will receive a prorated buy-out for
  within grade increases when they are placed into
  the system
• After that, those funds will become part of the
  monies available for performance payouts or the
  other increases mentioned above
• How will DoD insure the money is really paid out
  to the employees?
• DoD is currently developing a financial policy to
  insure these funds are protected

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Most Frequently Asked Questions (Contd)

• Will veterans preference for RIF and hiring go
  away? No
• NSPS preserves veterans preference. The
  preference that veterans receive under the
  current system does not change under NSPS
• Will seniority and veterans preference count in
  the event of a reduction in force (RIF)? Yes
• Seniority is still a factor in RIF.
• Veterans preference eligibles are still retained
  over non-veterans in RIF
• Greater emphasis on performance in RIF retention
• Performance ahead of length of service
• Tenure group
• Veterans preference
• Performance
• Length of service

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Most Frequently Asked Questions (Contd)

• Will there be a process for employees to
  challenge their performance rating? Yes
• Reconsideration process in implementing issuances
• Will be a separate reconsideration process that
  will afford every employee an opportunity to seek
  appropriate redress
• Will there be a process where employees can
  exercise their fundamental rights to grieve or
  appeal unfair decisions or adverse actions? Yes
• Employees will continue to retain critical rights
  such as merit systems principles, due process,
  whistleblower protections, and protection against
  prohibited discrimination and prohibited
  personnel practices.

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Most Frequently Asked Questions (Contd)

• Is the proposed appeal system an impartial
  process? Yes
• It retains MSPB administrative judges as initial
  adjudicators of employee appeals and adverse
  actions
• Employees retain right to petition full MSPB for
  review of the record of a final DoD decision
• Will DoD continue to have bargaining units and
  employee unions? Yes
• The implementation of the NSPS labor relations
  system will not eliminate unions or bargaining
  units. Employees will still be able to
  participate in labor organizations and to bargain
  collectively.

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Benefits of Proposed NSPS

• Proposed HR system provides greater flexibility
  to respond effectively to mission needs, while
  fostering excellence and ensuring accountability
• Employees will have greater opportunity to affect
  their pay through excellent performance
• Pay increases based on performance and/or
  contribution to mission success clear
  performance expectations linked to strategic
  Department goals and objectives
• Safeguards built into performance appraisal
  process to promote fairness, transparency, and
  accountability
• Managers will be able to recruit/retain high
  quality talent more effectively
• Ability to offer more competitive,
  market-sensitive compensation
• Ability to fill jobs faster with streamlined
  hiring processes

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Notice and Comment Information

• The proposed NSPS regulations are subject to
  change, based on consideration of formal comments
  received during the comment period and the
  results of the meet and confer process with
  employee representatives decisions on NSPS are
  not final until final regulations are published
  (targeted for late spring)
• Individuals are encouraged to read the full text
  of the proposed regulations and provide comments
  and/or recommendations on the proposal
• The 30-day comment period is the opportunity to
  submit formal comments on the regulations
  comments must be received by March 16, 2005
• Methods for submitting comments
• Internet visit www.cpms.osd.mil/nsps to access
  the proposed regulations, review background
  information on NSPS, and formally submit comments
  via the web
• U.S. Mail formal written submissions may be
  sent to

Program Executive Office, NSPS Attn Brad
Bunn 1400 Key Boulevard, Suite B-200 Arlington,
Virginia 22209-5144
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Back-up Slides
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Classification

• New pay banding system simplifies job
  classification process and provides flexibility
  to assign work amidst changing mission
  requirements and new technologies
• Simplified structure replaces General Schedule
  system
• Positions grouped in broad career groups and pay
  schedules based on nature of work, mission,
  career patterns, competencies
• Pay bands replace GS grades with broad salary
  ranges, based on level of work (e.g., entry
  level, full performance level, supervisor)
• Pay bands provide more flexibility to assign
  employees new or different work
• Lengthy, detailed job descriptions no longer
  needed
• Movement through pay band based primarily on
  performance/contribution, increased
  responsibility or job complexity
• Back

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Pay/Compensation

• The proposed pay system is intended to attract,
  develop, retain, and reward high-performing
  employees through appropriate compensation
• Regulations provide framework for DoD to move
  towards market sensitive pay
• Consideration of local market conditions to set
  pay band rates
• Market factors taken into account on setting pay
  for new hires
• Annual performance pay increases
• Based on performance/contribution, rather than
  longevity
• Larger increases to outstanding performers
• Increases not given to unacceptable performers
• Adjustments to rate ranges determined by
  Secretary increases associated with rate range
  adjustments not given to unacceptable performers
• Greater flexibility in pay setting upon
  promotion, reassignment, etc. Back

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Performance Management

• The NSPS proposed performance management system
  is designed to foster a high-performing culture,
  encourage employee engagement and robust
  communication, and enhance the overall
  effectiveness of the Department
• Cornerstone of a successful performance-based pay
  system
• Supervisors work with employees to establish
  performance goals and expectations, aligned with
  mission-related goals
• Recognition of conduct (behavior, professional
  demeanor) as an element of performance
• Ongoing feedback and communication between
  supervisor and employees
• Intense training planned (employees, supervisors,
  managers, HR community)
• Ratings reflect meaningful distinctions in
  employee performance (no forced distribution or
  quotas)
• Formal process to be established to challenge
  ratings
• Back

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Hiring/Staffing

• NSPS proposal provides flexibilities to improve
  hiring processes, attract high-quality
  applicants, and enable DoD to meet critical
  mission requirements, while respecting principles
  of merit and fitness, and preserving veterans
  preference
• DoD, with OPM, may establish new hiring
  authorities, tailored to DoDs needs
• No change in veterans preference
• Government-wide hiring authorities and tools
  retained
• Direct-hire authority for severe shortage or
  critical needs vested in Secretary
• Opportunity to improve, streamline examining
  procedures to speed up the hiring process
• Back

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Reduction in Force

• Proposed reduction in force (RIF) changes
  designed to streamline the procedures used to
  shape organizations
• No change in veterans preference for RIF
• Simplified RIF process
• Greater precision in defining competitive areas
  and retention lists (based on organization,
  location, line of business, or other business
  related factors)
• Flexibility to minimize disruption associated
  with RIF
• Greater emphasis on performance (over seniority)
  in RIF
• Back

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Adverse Actions

• Proposed changes designed to recognize need for
  workplace accountability, provide efficient tools
  for dealing with performance and conduct issues,
  and protect rights of employees
• Single process for taking adverse actions based
  on performance and/or conduct
• Streamlined 15-day notice/10-day reply period
• Ensures due process
• Allows Secretary to designate Mandatory Removal
  Offenses (MROs)
• Proposed regulations provide Secretary authority
  to establish MROs, but do not specify offenses
• Recognizes potential need to identify list of
  offenses so egregious as to warrant mandatory
  removal, reserving authority to mitigate penalty
  to Secretary only
• Development and publication of MROs would include
  input from employee representatives
• Back

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Appeals

• NSPS proposal provides for streamlined, efficient
  appeals process that provides deference to DoDs
  critical national security mission, while
  preserving employee protections and due process
• Expedited appeals process, using MSPB
  administrative judges (AJ), with improved
  procedures
• Filing deadline for appeals reduced to 20 days
• Summary judgment provided for when facts not in
  dispute
• Initial decision must be rendered within 90 days
• Provides for DoD review of decisions
• DoD has 30 days to review initial decision (or it
  becomes final)
• DoD may remand, modify, affirm, or reverse
  initial decision, based on stringent criteria
• Final DoD decisions (including AJ decisions that
  become final) may be appealed to full MSPB, which
  retains limited review authority
• Single burden of proof standard preponderance
• Mitigation by MSPB permitted only when penalty is
  wholly without justification
• Judicial review retained
• Next

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Labor Relations

• New proposed labor relations system designed to
  recognize DoD national security mission and its
  need to act expeditiously in executing its
  mission, while preserving collective bargaining
  rights of its employees
• Proposal expands non-negotiable management rights
  (to include determining numbers, types and grades
  of employees, methods, technology and means of
  performing work)
• Prohibits bargaining over procedures in
  exercising core management rights, but management
  will consult with unions (consideration of union
  views recommendations but agreement not
  required)
• DoD and Component-wide issuances (e.g.,
  directives, policies, manuals) non-negotiable
• Provides for bargaining over procedures in
  exercising other management rights (e.g.,
  layoffs, RIF, selection or promotion procedures,
  disciplinary actions), but do so prospectively
  (post-implementation)
• Expedited collective bargaining with impasse
  resolution
• Nothing delays managements ability to act to
  accomplish mission
• Bargaining required over changes to conditions of
  employment, when change is foreseeable,
  substantial, and significant in impact and
  duration
• National level bargaining (bargain the same issue
  once with all national unions) at the discretion
  of the Secretary
• Establishes National Security Labor Relations
  Board to resolve DoD labor disputes
• Next

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Pay Band Illustration
Sample NSPS Pay Band Structure Career Group APay
Schedule 1 (nonsupervisory)
Level 3 Senior Expert
Level 2 Full Performance Level
Level 1 - Entry/Developmental

• Levels represent rate ranges associated with
  ranges of work in career group
• Rates (minimum/maximum) may be set and adjusted
  based on market factors
• Separate pay schedules may be established for
  certain occupations, where market or other
  conditions warrant

Next
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Merit Systems Protection Board vs. DoD Appeals
Process
Current MSPB Process
Proposed DoD Appeals Process
Appeal action
20 days to appeal
30 days to appeal
Appeal action
MSPB
90 days to decide
MSPB AJ Decision
No time limit
AJ Decision
DoD
RFR to DoD MSPB

• DoD action serve notice in 30 days to
• Remand
• Affirm
• Reverse
• Modify

30 days to file RFR
35 days to file PFR
PFR to MSPB
30 days to act or not
DoD action
No time limit
MSPB
90 days to decide
MSPB (PFR)
Limited Review
Appeal to Court
60 days to appeal
Appeal to Court
60 days to appeal
Board is required to decide on actions involving
discrimination within 120 days.
No time limit
Court of Appeals
Court of Appeals
No time limit
Back
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• Federal Labor Relations Authority vs. National
  Security Labor Relations Board

Current FLRA Process
Proposed NSLRB Process
FLRA
ULP Charge
ULP Charge
NSLRB
Investigation
Investigation
Under proposed NSPS rules, FLRA will still
determine appropriate bargaining units under NSPS
rules and supervise elections. NSLRB will
determine national consultation issues.
ULP Complaint
ULP Complaint
ALJ Hearing
ALJ Hearing
Arbitration Appeal
Negotiability Appeal
Arbitration Appeal
Negotiability Appeal
NSLRB Decision
FLRA Decision
FLRA Review
Limited Review
Court of Appeals
Next
Court of Appeals
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• Federal Service Impasses Panel vs. National
  Security Labor Relations Board

Current FSIP Impasse Process
Proposed NSLRB Impasse Process
Negotiations Impasse
Negotiations Impasse
FSIP
Mediation
Mediation
Request for NSLRB Assistance
Request for FSIP Assistance
NSLRB
NSLRB Impasse Procedures
FSIP Impasse Procedures
NSLRB Decision
FSIP Decision
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